WETHERSFIELD, January 27, 2014 - Connecticut’s nonfarm employment declined 3,900 (-0.2%, seasonally adjusted) to a level of 1,651,200 jobs in December, according to the federal business establishment survey. This reversed a 3,800 (0.2%, revised) job gain the state experienced in November. The private sector dropped 3,800 (-0.3%) jobs and government positions fell by 100 (-0.04%). Nonfarm employment has grown 11,500 (0.7%) jobs since December 2012 (and year to date).

Connecticut’s unemployment rate continued to decline in December, dropping two-tenths of a percent to 7.4%. The state’s unemployment rate is now eight-tenths of a percentage point below a year ago (8.2%). This is the fourth straight monthly decline in the unemployment rate since summer and builds on November’s three-tenths of a point fall. The reduction in the number of unemployed residents in the state over the year is 17,171 (-11.2%).

“Connecticut’s payroll job counts appear to have been affected by bad winter weather around the time of the survey reference week,” said Andy Condon, Director of the Office of Research. “On a brighter note, the state’s unemployment rate continues to fall, and for better reasons than has sometimes been the case in the recent past. Declines in the number of unemployed residents largely were the result of employment rather than individuals leaving the labor force.”

Preliminary December job estimates indicate that the state lost 3,900 (-0.2%) jobs, a reversal of the 3,800 jobs (0.2%) added in November. The private sector (-3,800, -0.3%) and the government supersector (-100, -0.04%) both lost jobs last month. Connecticut has now added 11,500 total nonfarm jobs (0.7%) since December 2012, for a seasonally adjusted total of 1,651,200. Hiring in the private sector has been better over the year, adding 12,800 positions (0.9%). Government is down 1,300 (-0.5%) positions since December 2012.

Nonfarm Jobs: Connecticut’s seasonally adjusted nonfarm job growth year-to-date through December 2013 has been 11,500 jobs (958 per month). This is more than the 8,600 jobs gained in the year-to-date through December of 2012 (717 per month). In 2011, the 12 months of the year produced 14,300 jobs (1,192 per month) and in 2010, the year the employment recovery started, the year-to-date December gain was 9,900 (825 per month).

An alternative measure of job growth, annual average nonfarm employment (using 12 months of unadjusted rounded data), ended 2013 at 1,650,500 compared to 1,639,000 for 2012 (11,500 growth, 0.7%), 1,625,200 for 2011 (13,800 growth, 0.9%), and 1,608,000 for 2010 (17,200 growth, 1.1%, Census-boosted). Please note that this annual average of nonfarm jobs, which smoothes out month-to-month volatility over the year, is subject to the annual benchmark revision process which will be applied to January’s Labor Situation statistics scheduled for release on Friday, March 14, 2014. The month delay in releasing the January 2014 Labor Situation occurs because of the normal extra workload involved in the benchmark revision process.

Recession Recovery: Connecticut has now recovered 59,400 positions, or 49.0% of the 121,200 seasonally adjusted total nonfarm jobs that were lost in the state in the March 2008 - February 2010 employment recession. Connecticut’s jobs recovery is now 46 months old and is averaging approximately 1,291 jobs per month since February 2010. The private sector has recovered a little faster and has now regained 67,600 (59.3%, 1,470 per month) of the 114,000 private jobs that were lost during the same period. Now at 1,651,200 nonfarm jobs in December, the state needs to reach the 1,713,000 level to achieve an employment expansion. This will require an additional 61,800 jobs.

Labor Market Areas (LMAs): For December 2013, four of the six major Connecticut Labor Market Areas (Bureau of Labor Statistics recognized LMAs) posted job losses, while the Waterbury LMA (200, 0.3%) posted a small gain. The Danbury LMA was unchanged. The New Haven LMA (-2,100, -0.8%) came up with the largest job loss in magnitude and percentage terms. The Bridgeport-Stamford-Norwalk LMA (-1,700, -0.4%) also had a weak monthly showing as did the Hartford LMA (-700, -0.1%). A smaller job loss was estimated in the Norwich-New London LMA (-300, -0.2%).

Hours and Earnings: The private sector workweek, not seasonally adjusted, averaged 33.6 hours in December 2013, down six-tenths of an hour from the December 2012 figure (34.2, -1.8%). Average hourly earnings at $28.00, not seasonally adjusted, were down 31 cents, or -1.1% from the December 2012 hourly private sector pay estimate. The resulting average private sector weekly pay was calculated at $940.80, down $27.40, or -2.8% over the year. The year-to-year change in the Consumer Price Index for All Urban Consumers (CPI-U, U.S. City Average) in December 2013 was 1.5%. Information for the manufacturing production workweek and earnings can be found in the table section of this release under the “Hours and Earnings” data category.

Just two industry supersectors added jobs in December, while seven supersectors exhibited declines.  Leisure & hospitality was unchanged.  On the plus side were other services (900, 1.5%) and financial activities (300, 0.2%).  Note that this is the second consecutive month of job growth in the strategic Finance and insurance Industry which had previously shed jobs throughout the recession / recovery cycle to date.

The seven declining industry supersectors may have been weather impacted to some degree and were led lower by the professional business services (-2,600, -1.3%).  In this grouping, much of the weakness came from administrative and support services (-3,400, -3.9%), more specifically from services to building and dwellings which can be affected by the weather.  Trade transportation & utilities also lost jobs (-1,300, -0.4%) with most of the decline coming from transportation and utilities (-1,200, -2.3%) and a slight drop from retail trade (-100, -0.05%).  Wholesale trade was unchanged.  The combined construction and mining (-300, -0.5%) industry supersector was lower as well.  Manufacturing lost jobs (-300,-0.2%), with the more capital intensive durable goods component (-300, -0.2%) weaker. The nondurable goods segment went unchanged.  The education and health services supersector (-300, -0.1%) also posted a small decline.  Education (-1,300, -1.9%) was decidedly lower with weakness from private colleges and universities while a health services gain (1,000, 0.4%) could not offset the overall supersector decline.  The information supersector (-200, -0.7%) was lower last month as well.  And again government employment continued to decline (-100, -0.1%) with the entire monthly drop associated with local government (-200, -0.1%).

Connecticut’s Ten Industry Supersector Performance (YTD December 2013: 5 up, 5 down, before revisions)

1.)     Education and Health Services (7,900, 2.5%)                6.) Information (-600, -1.9%)

2.)     Construction and Mining (5,800, 11.4%, combined)       7.) Government (-1,300, -0.5%)

3.)     Trade, Transportation, and Utilities (4,200, 1.4%)          8.) Financial Activities (-1,300, -1.0%)

4.)     Professional and Business Services (1,400, 0.7%)          9.) Other Services (-1,400, -2.2%)

5.)     Leisure and Hospitality (800, 0.6%)                               10.) Manufacturing (-4,000, -2.5%)

Annual Average Unemployment Rates since the Recovery began. (These data are subject to yearly processing before the release of the January 2014 state data - released March 14, 2014 - and could change to some extent.)
2013 - 7.9%
2012 – 8.4%
2011 – 8.9%
2010 - 9.3%

The nonfarm employment estimate, derived from a survey of businesses, is a measure of jobs in the state; the unemployment rate, based on a household survey, is a measure of the work status of people who live in Connecticut. Overall, as the national and state economies recover, volatility in monthly numbers can be expected. Additionally, changes in methodology that culminated in March 2011 with the U.S. Department of Labor, Bureau of Labor Statistics assuming complete responsibility for estimating all states’ monthly nonfarm job counts, have contributed to the month-to-month variability in the numbers. Jobs estimates are best understood in the context of their movement over several months rather than observed changes in a single month’s estimate.